Autonomy Buys Iron Mountain Digital Assets

Migrated from eDJGroupInc.com. Author: Barry Murphy. Published: 2011-05-16 23:24:13  The market has been awaiting word on where the assets of Iron Mountain Digital would end up.  Previously, we speculated who the potential buyers might be and what the future might hold for Iron Mountain Digital. We now know the answer – Autonomy is purchasing the assets for $380 million.  That’s not a huge multiple on the revenues of Iron Mountain Digital, but it’s still a big acquisition number in our space.  Now we must wonder if this is good news, bad news, or something in between.Personally, I feel like this is a good development all around.  A larger vendor like Dell, EMC, IBM, HP, or Oracle could have swooped in and bolstered an information governance offering by picking up Iron Mountain Digital.  The cloud storage angle certainly fits with what the large vendors are trying to do.  Some might think that Autonomy stole a march on the big boys…and that could be true.  But, I believe the digital assets of Iron Mountain will be a better fit at Autonomy because the company is so focused on eDiscovery, archiving, and the governance side of information management.  I think that, at a larger company, Iron Mountain Digital could have gotten lost and off-track.It’s true that current Iron Mountain Digital customers will have to worry about the future of their products.  But, that would be the case no matter who the acquiring company had been.  At least at Autonomy, customers will have a vendor focused very squarely on this market space and with the resources to support complex eDiscovery initiatives.The biggest challenge will be for Autonomy.  The company will need to quickly determine what Iron Mountain Digital products and services will keep going and what will be transitioned to existing Autonomy products and services.  For example, will Autonomy keep both the EAS archiving product and the NearPoint archiving product line?  The company will also have to get past its reputation for having expensive, complex deployments suitable for only the largest enterprises if it wants to compete with upstart vendors that will offer lower pricing and quick-hit solutions.If Autonomy is able to successfully integrate the Iron Mountain Digital business, the company will become an acquisition target itself (rumors of Oracle buying Autonomy have been around forever).  To me, that’s the beauty of this acquisition – Iron Mountain Digital needed to wind up at a company that could really give it care and feeding and focus.  Autonomy is the best fit for that.  Autonomy can win by transitioning customers and further adding to its leadership in the information governance market.  It then has many options ahead, including getting bought or continuing to grow the company to challenge the big boys.I don’t see any real losers here, other than Iron Mountain having to concede that it couldn’t pull off a move to the digital world.  And, I’m sure there will be some duplicative employees that will need to find new work.  But otherwise, I think this is something of a best-case scenario given the circumstances.